Relevance and Risk in the New Connection Economy
A question we often ask ourselves at Interbrand is:
“What if the dust never settles?”
If discontinuity, volatility, and disruption really are the status quo, then what are the implications for brands? Increasingly, this dynamism challenges some of the most widely accepted constructs in branding, pushing us to think differently. In our Arenas programme, we focus on the least stable of those constructs: competition.
Traditional strategy defines a business’ competition as the major players in the same category offering the same type of products and services. Today, competition may come from any category that can address similar customer needs or, to use Clayton M Christensen’s definition, Jobs To Be Done. But it may also come from categories that compete for the same customer resources, such as money and time. This shifting context means strategic focus needs to address arenas over industries.
“Snow melts from the edges”, notes Columbia Business School professor, Rita McGrath. “Thinking your competition is within your own industry creates major blind spots.” Today, a brand’s major opportunities and existential threats are less likely to come from the usual suspects at the heart of their industries than from what’s about to happen on the fringes.
In response to this evolution, Interbrand has developed Arena Collectives – global, multi-disciplinary groups of experts in Human Truths, Economics and Experience whose unique perspective helps our clients spot change on the peripheries and reimagine or enhance their competitive strategy. Working Outside In and Future Back, our Collectives offer a new lens on the competitive landscape which is grounded in consumers’ evolving expectations, rather than on industry norms.
Our Arena Collectives are organised to tap into consumers evolving expectations around the need to Play – sport, gaming, entertainment, and much more; around the need to Express oneself, bringing together the likes of fashion, luxury goods and services and some forms of arts; and the need to Move people and things, addressed by spaces such as mobility, logistics and transportation. In this, our fourth report, we look at brands competing to Connect people and things.
Since its full-scale advent 30 years ago, Connect – as a need and a possibility – has redefined economies and societies. It has created an environment of exponential transformation and immediate propagation, meaning that radical change – ideas, movements, growth, habits – is happening at a speed and scale never seen before.
According to futurist Ray Kurtzweil, over the next hundred years, we may experience twenty thousand years of technological advancement. In the Decade of Possibility, as a result of a proliferation of new technology, we will see an evolution in how people and things connect and changes that once took decades will happen in years – or even months.
As modes and nodes of connection emerge, mature and evolve, wave-upon-wave of relevance crisis is created.”
What does this mean for brands? Everything. As modes and nodes of connection emerge, mature and evolve, wave-upon-wave of relevance crisis is created. Connect brands themselves – the originators of this change – are as vulnerable to these waves as any other brand. Take for example the Connect brands that dominated during the emergence of Web 1.0, such as AOL, MySpace, Nokia, and Blackberry, all of which lost relevance and brand value as Web 2.0 emerged and presented new modes of connection, anachronizing their capabilities and driving a revolution in customer expectation. As Web 2.0 cedes its power to a decentralized, open and immersive version of Connect, brands are presented with an existential risk to relevance and an ever more fluid competitive landscape.
And precisely because Connect is at once operating environment, arena, brand and motivation – the implications found within the Arena prove to be among the most important – with implications for all brands. The implications of Connect affect Apple, Microsoft, Meta and Google, of course. Will they maintain their relevance and value as the rules of digital engagement shift? But the changes in Connect will also be decisive in shaping the future of Nike, McDonald’s, or Chanel.
In this report our global Connect Collective examines the new connection economy to establish how your convergence agenda can drive relevance and mitigate the risks ahead.
Culture evolves, customer expectation shifts.
Someone is already rethinking your category.